Binding court undertakings, unexplained default, and inability to repay justified contempt exposure and provisional liquidation.

A settlement or undertaking recorded before the Court remains binding unless varied by timely application, and unexplained non-compliance after affirming the payment schedule may amount to wilful disobedience. The respondent's reliance on a corporate debt restructuring process did not excuse default where it neither sought modification of the court-directed instalments nor gave a satisfactory explanation, and contempt consequences followed. On the winding-up side, inability to pay the outstanding debt and failure to propose a workable restructuring supported revival and admission of the company petition. The earlier default-triggered order was given effect, resulting in appointment of the Official Liquidator as provisional liquidator and further winding-up directions.

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Issues: (i) Whether the respondent's failure to honour the settlement recorded before the Court amounted to wilful disobedience of a binding undertaking; (ii) whether the company petition deserved revival and admission with appointment of the Official Liquidator as provisional liquidator.

Issue (i): Whether the respondent's failure to honour the settlement recorded before the Court amounted to wilful disobedience of a binding undertaking.

Analysis: The respondent had undertaken before the Court to pay the agreed amount in instalments, and that arrangement was later affirmed and not varied. The respondent proceeded with a corporate debt restructuring process without seeking timely modification of the court-directed payment schedule, did not candidly disclose its inability to comply, and offered no satisfactory explanation for the default. The Court treated the undertaking as solemn and binding, and held that the respondent could not rely on the restructuring process to escape compliance with the court order.

Conclusion: The disobedience of the order was held to be wilful and not bona fide, and the respondent was found liable to show cause in contempt.

Issue (ii): Whether the company petition deserved revival and admission with appointment of the Official Liquidator as provisional liquidator.

Analysis: The Court found that the respondent was not in a position to repay the outstanding debt and had failed to propose a workable restructuring of the liability owed to the petitioner. The statutory grounds for winding up on inability to pay debts were held to be made out. Since the earlier order expressly provided for appointment of the provisional liquidator on default, revival of the petition and appointment of the Official Liquidator followed as the consequential relief.

Conclusion: The company petition was revived and admitted, and the Official Liquidator was appointed as provisional liquidator, with further winding-up directions issued.

Final Conclusion: The Court enforced the settlement-linked payment obligation, held the default to be deliberate, and advanced the winding-up proceedings by reviving the petition and putting the company under provisional liquidation, while also initiating contempt consequences.

Ratio Decidendi: A settlement or undertaking recorded before the Court is binding and enforceable, and unexplained non-compliance with such an undertaking, especially without seeking timely variation despite changed circumstances, can constitute wilful disobedience and justify winding-up and provisional liquidation consequences.

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